Losses forecast for GBP CAD Exchange Rate, Gains Predicted for GBP EUR

September 30, 2015 - Written by John Cameron

STORY LINK Losses forecast for GBP CAD Exchange Rate, Gains Predicted for GBP EUR

Global stock markets started yesterday’s session firmly on the back foot but news from India triggered a pronounced uptick in risk sentiment as the session progressed.

The Reserve Bank of India (RBI) opted to trim its key interest rate during yesterday’s Asian session – this much had been expected following the news that the pace of price rises in India slumped to a relatively lowly 3.6% last month. However, the extent of the policy loosening from Asia’s third most significant central bank surprised many market participants. India’s headline interest rate, the RBI repo rate, stood at a heady 7.25% when this week’s session got underway, but yesterday’s announcement of a 50 basis point cut sent it down to its lowest level for some four and a half years.

The news of further easy money from one of the world’s premier lenders of the last resort was just what investors were looking for and risk sentiment around the world improved as a consequence. The Pound Sterling had recorded decent gains against the Commodity Dollars during early trading, but the development from India saw the Australian Dollar (currency : AUD), New Zealand Dollar (currency : NZD) and the Canadian Dollar (currency : CAD) stage a concerted comeback against the UK unit. Global commodity prices also staged a mini-rally as a result.

Looking ahead, data highlights for this week’s session come from either side of the Atlantic in the form of the latest whole of Eurozone Consumer Price Index inflation numbers and this afternoon’s Canadian Gross Domestic Product data for July. If, as expected, the Canadian growth numbers point to an increase in the level of economic activity in the North American state, then analysts forecast that the Pound Sterling Canadian Dollar exchange rate could slump back down towards the two to one threshold. Meanwhile, if the inflation data from the euroland shows that price rises have once again stalled in the region, then expect the Pound euro exchange rate GBP EUR to move Northwards once again.

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TAGS: Pound Euro Forecasts Pound Rupee Forecasts Pound Sterling Forecasts